Students can dramatically increase their earning power by climbing the qualifications ladder, a study reveals.

The research by the London School of Economics shows that by gaining a degree a woman can earn up to 26% more than a woman who did not continue her education beyond A-levels.

And a man can earn about 23% more by going on to complete a degree course.

The study - published on the day thousands of young people around the country got the results of their A and AS-levels - was commissioned by the Learning and Skills Council.

Its chief executive, John Harwood, said many young people appeared not to realise fully the financial benefits of further study.

How much qualifications raise your earning power:

Qualification

Men

Women

Level 1

8.72%

9.92%

Level 2

17.10%

17.60%

Level 3

29.70%

28.80%

Level 4

52.10%

54.40%

Level 5

66.80%

71.60%

"Sadly whilst almost half of the population attain A-levels or their equivalent, only just over a quarter progress to the next level.

"We want more young people to see these qualifications as a launch pad to further learning and the realisation of their full potential," Mr Harwood said.

'Rethink needed'

The National Union of Students (NUS) backed Mr Harwood's call for more young people to go to university.

But it urged more financial support for them, saying that more than 20% of students dropped out of their courses.

A Levels can increase earning power by more than half

"The government is getting it right in schools but the NUS urges a rethink of the financial support system for students in further and higher education.

"It should abolish tuition fees and introduce targeted grants to support those who need it most," an NUS spokesperson said.

But last year some 9,500 university places went unfilled and a surplus is expected again this year.

It has led to fears among unions that some universities and colleges may cut back on staff.

The general secretary of lecturers' union Natfhe, Paul Mackney, urged them to think again before taking action.

"Natfhe hopes that rising student achievement in post-16 education will encourage universities and colleges to hold on to any staff under threat of redundancy and allow universities to increase their student intakes next year," he said.